DEFINITION of 'Bona Fide Error'
An error that was unintentional; an "honest error." If a bona fide error is corrected immediately, then a defendant may not be liable for an action.
For example, under the Truth in Lending Act, a creditor can avoid liability by demonstrating that a violation was unintentional and was caused by a bona fide error, including clerical, calculation, computer malfunction or printing error. An error in legal judgment, however, is not ordinarily considered a bona fide error.
BREAKING DOWN 'Bona Fide Error'
Bona fide is a Latin phrase that means "in good faith," and thus sincere or honest. It can also mean authentic or genuine; a bona fide Van Gogh is a painting by Van Gogh. The various uses of bona fide reflect these meanings. For example, a bona fide resident is someone who resides, continuously and without interruption, for a certain minimum period of time.